This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.Need a new registration confirmation email? Click here

Glu Reports Third Quarter 2012 Financial Results

“Our results continue to be driven by the growth of freemium revenue and original IP," stated Eric R. Ludwig, Glu’s Chief Financial Officer. “Our fourth quarter is being impacted by the combination of underperforming titles launched in Q3, Apple’s prohibition of incentivized advertising for external HTML 5 sites along with the reduction in the number of titles launched during the quarter as we further optimize their monetization. With more than $24 million in cash and no debt on our balance sheet, as well as an ongoing focus on controlling costs, Glu remains well positioned to execute its long-term monetization strategy.”

Business Outlook as of November 1, 2012:

The following forward-looking statements reflect expectations as of November 1, 2012. Results may be materially different and are affected by many factors, such as: consumer demand for mobile entertainment and specifically Glu’s mobile products; consumer demand for smartphones, tablets and next-generation platforms; development delays on Glu's products; continued uncertainty in the global economic environment; competition in the industry; storefront featuring and premium deck placement; smartphone storefronts, carriers and other distributors maintaining their networks and provisioning systems to enable consumer purchases; changes in foreign exchange rates; Glu's effective tax rate and other factors detailed in this release and in Glu's SEC filings.

Fourth Quarter Expectations – Quarter Ending December 31, 2012:

Non-GAAP revenue is expected to be between $19.5 million and $20.5 million and non-GAAP smartphone revenue is expected to be between $17.5 million and $18.5 million.

Non-GAAP gross margin is expected to be approximately 90%.

Non-GAAP operating expenses are expected to be approximately $22.2 million.

Adjusted EBITDA, defined as non-GAAP operating loss excluding depreciation of approximately $650,000, is expected to range from $(4.0) million to $(3.1) million.

Income tax expense is expected to be $(0.5) million.

Non-GAAP net loss is expected to be between $(5.1) million and $(4.2) million, or a net loss of $(0.08) to $(0.06) per weighted-average basic share.

Weighted average common shares outstanding for the fourth quarter of 2012 are expected to be approximately 65.9 million basic and 69.9 million diluted.

We expect to use cash in operations and have a cash balance at December 31, 2012 of approximately $21.5 million with no debt.

2012 Expectations – Full Year Ending December 31, 2012:

Non-GAAP revenue is expected to be between $86.4 million and $87.4 million and non-GAAP smartphone revenue is expected to be between $73.6 million and $74.6 million.

Non-GAAP operating loss is expected to range from $(6.8) million to $(5.9) million.

Adjusted EBITDA is expected to range from $(4.4) million to $(3.5) million.

Quarterly Conference Call

Glu will discuss its quarterly results via teleconference today at 1:30 p.m. Pacific Time (4:30 p.m. Eastern Time). Please dial (888) 634-0559, or if outside the U.S., (817) 385-9380, with conference ID # 38947409 to access the conference call at least five minutes prior to the 1:30 p.m. Pacific Time start time. A live webcast and replay of the call will also be available on the investor relations portion of the company's website at
www.glu.com/investors. An audio replay will be available between 3:10 p.m. Pacific Time, November 1, 2012, and 8:59 p.m. Pacific Time, November 8, 2012, by calling (855) 859-2056, or (404) 537-3406, with conference ID # 38947409.

Use of Non-GAAP Financial Measures

To supplement Glu's unaudited condensed consolidated financial data presented in accordance with GAAP, Glu uses certain non-GAAP measures of financial performance. The presentation of these non-GAAP financial measures is not intended to be considered in isolation from, as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP, and may be different from non-GAAP financial measures used by other companies. In addition, these non-GAAP measures have limitations in that they do not reflect all of the amounts associated with Glu's results of operations as determined in accordance with GAAP. The non-GAAP financial measures used by Glu include historical and estimated non-GAAP revenues, non-GAAP smartphone revenues, non-GAAP freemium revenues, non-GAAP operating expenses, non-GAAP gross margins, non-GAAP operating income/(loss), non-GAAP net loss and non-GAAP basic and diluted net loss per share. These non-GAAP financial measures exclude the following items from Glu's unaudited consolidated statements of operations:

Change in deferred revenues and royalties;

Amortization of in-process development contracts;

Amortization of intangible assets;

Stock-based compensation expense;

Restructuring charges;

Change in fair value of Blammo earnout;

Transitional costs;

Impairment of goodwill;

Release of tax liabilities; and

Foreign currency exchange gains and losses primarily related to the revaluation of assets and liabilities.

In addition, Glu has included in this release “Adjusted EBITDA” figures which are used to evaluate Glu’s operating performance and is defined as non-GAAP operating income/(loss) excluding depreciation.

Product Features:

To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.